Knighthood for Gates

The honorary knighthood for Bill Gates and the speculation on the bidders for AT&T Wireless dominated the international world of IT and telecommunications last week.

The SCO Group`s spate of Linux law suits, initially only against IBM, has catapulted it into 'the most hated ICT company` position.

Paul Booth, MD, Global Research Partners

At home, the Connection Group`s acquisition and the Telkom share repurchase for its staff equity scheme stole much of the local ICT headline space.

We saw mediocre interim numbers from Prism (revenue well down but earnings well up); Positive earnings warnings from Control Instruments and ERP.com; and A negative profit warning from Infowave.

Other local news included:

* A share re-purchase announcement from Telkom SA;
* Motswedi acquired a 25% stake in IFS Defence SA;
* Comztek and NetShield created a joint venture; The appointments of Gary Lawrence as country manager of Computer Associates SA and Graham Wackrill as CEO of Metrofile;
* The Connection Group`s acquisition of several photographic equipment, developing and printing stores;
* Norman Webster retired as CEO of Metrofile; and
* The change of designation of Leonard Fine`s position at Cycad to executive chairman only.

New local distributorships included that of CNET`s wireless technologies by Rectron and RSA Security by SecureData, and the announcement of a strategic partnership between Adroit Technologies and Nasdaq-listed Cimnet.

On the local front, look out for the finalisation of the Pinnacle black economic empowerment deal with Rokunda Investment Holdings.

* The announcement of an honorary knighthood for Bill Gates;
* Telemais Telecomms changed its name to WebSky;
* Hitachi and Omron created a joint venture re their ATM and other information equipment businesses;
* ISoft Group sold off its Torex Retail Business;
* Iowa Wireless Services changed its name to i wireless; and
* There were indications that the European Commission is likely to rule against Microsoft, with a final set of decisions/recommendations coming before 1 May.

Additionally, look out for Google`s imminent initial public offering (IPO), a possible IPO from Virgin Mobile following the settlement of a long-standing dispute between it and T-Mobile; the outcome of the auction for AT&T Wireless with Vodafone being a possible bidder; and the acquisition of Debitel, the German telecommunications group, by Permira, a UK private equity group, in a deal likely to be worth about EUR1.2 billion.

Other international news included:

* The appointments of Milton Cooper as chairman of Identix, Robert Cradall as chairman of Celestica, Stephen Delaney as CEO of Celestica, Don Detampel as CEO of Raindance, Douglas Haffer as chairman, president and CEO of WebSky, Don Morrison as president of Chordiant Software, Sasson Somekh as president of Novellus and Peter Tierney as CEO of Finaplex; * The resignation of Norman Rokosh as president and CEO of Analytical Surveys; * The retirement of Eugene Polistuk as chairman and CEO of Celestica; and * job loss announcements from EDS and IBM.

We saw excellent* figures from Ascential Software (back in the black), Cray, Dot Hill Systems (back in the black), Lexar Media, M-Systems (back in the black), SafeNet, SigmaTel, Silicon Labs and ViaSat (back in the black).

Very good* numbers were posted by Activision, Amazon.com, Artisan Components, Artesyn (back in the black), Axcelis Technologies (back in the black), BakBone Software (back in the black), Broadcom (back in the black), ChipPAC (back in the black), CyberGuard, DiamondCluster international (back in the black), Digital River, DSP Group, Electronic Arts, Fiserv, Foundry Networks, Helix Technology (back in the black), InfoSpace (back in the black), Input/Output, International Rectifier (back in the black), Magna Design Automation (back in the black), Mapics, NEC Electronics, Netegrity (back in the black), Perficient (back in the black), Photon Dynamics, Pixelworks, Sierra Wireless, STATS (back in the black), Taiwan Semiconductor, Tekelec (back in the black), Tessera Technologies, TTM Technologies, Varian Semiconductor and Veritas Software (back in the black).

Good figures* were recorded by Altera, Amkor (back in the black), API Electronics (back in the black), Artesyn (back in the black), Autonomy, Avid, Baldwin Technology, Banta, Cognex, CTS, Diebold, Digital Insight (back in the black), DoubleClick (back in the black), E.piphany (back in the black), Embarcadero Technologies, Epicor (back in the black), Extended Systems (back in the black), Fair Isaac, Harris, Imation, Inet Technologies, InterTAN, Ixia, Keithley Instruments (back in the black), Key Technology, L-3 Comms, Lexmark, Lockheed Martin (back in the black), MarketWatch.com, Micrel (back in the black), Micros, MicroStrategy, Mobius Management Systems, Moldflow, NIC, Nintendo (back in the black), Nortel Networks (back in the black), Opnet Technologies, Partner Comms, Pemstar (back in the black), Pioneer, Polycom, Primus Knowledge Systems (back in the black), Quest Software, RadiSys, RSA Security (back in the black), Sanyo, Sapient (back in the black), SpectraLink, Sunrise Telecom, Texas Instruments (back in the black), Transaction Systems Architects and Universal Electronics.

Satisfactory* results were reported by Anaren Microwave, ARM Holdings, Avaya (back in the black), Avnet (back in the black), AXS-One, Cadmus Comms (back in the black), CAM Commerce Solutions (back in the black), Canon, Cass Information Systems, Catapult Comms, CenturyTel, CNET Networks, Concurrent Computer (back in the black), Consolidated Graphics, Creative Technology, Cymer (back in the black), Datawatch, Digital Impact (back in the black), Dow Corning, DST Systems, EarthLink (back in the black), Exult, Flextronics, Fuji Photo Film, Fujitsu (back in the black), Harte-Hanks, Honeywell (back in the black), Internet Security Systems (back in the black), Intersil, ITG, Keynote Systems (back in the black), Kronos, LSI Logic (back in the black), Marconi, MEMC Electronic Materials, NCR, NEC (back in the black), Neoware, Network Associates (back in the black), Novellus, Optibase (back in the black), Renaissance Learning, SeeBeyond (back in the black), Sybase (back in the black), Synplicity (back in the black), Teledyne Technologies, Time Warner (back in the black), Viad, Vignette (back in the black), VISX (back in the black) and Xerox.

Mediocre* returns came from AFC, Ariba (but back in the black), ATG, BEI Technologies, Cable & Wireless, Cadence Design Systems, Concur Technologies (but back in the black), Conexant Systems (but back in the black), CSG Systems International, Digitas, Document Sciences, EFI, Group 1 Software, IKON, Inforte, Intergraph, Mattson Technology (but back in the black), Mentor Graphics, Micronetics, NDS Group, Oce NV, OSI, OSI Systems, PC Connection, PeopleSoft, Persistence Software (but back in the black), SBC Comms, Sony, STMicroelectronics, TALX and WebSense.

Very poor results* were posted by Entrust (but back in the black) and Forrester Research (but back in the black).

Losses* came from 724 Solutions, 8x8, Actuate, Adaptec, Advent Software, Agere Systems, Alliance Semiconductor, Altigen, Anadigics, Artisoft, Ask Jeeves, AudioCodes, Avici Systems, AVX, BackWeb Technologies, BMC Software, Bottomline Technologies, Brillion, Brooks Automation, BSQUARE, Celeritek, Celestica, Centillium Comms, Centra Software, Ceragon Networks, Ceva, Chartered Semiconductor, Chordiant Software, Coherent, Cohu, Corio, CSP, Cymer, DigitalThink, Gateway, i2 Technologies, Identix, InFocus, InfoVista, Interactive Intelligence, interWAVE, Interwoven, Intevac, Intrusion, JDS Uniphase, Key Tronics, LogicVision, Metalink, Monolithic Systems Technology, NetIQ, Newport, Nuance, Optical Comms Products, P-Com, Patsystems, PDF Solutions, Pericom Semiconductor, Phoenix Technologies, Pivotal, Power-One, Proxim, QuickLogic, RealNetworks, Retek, Silicom, Sirenza Microdevices, Somera Comms, SonicWALL, Stamps.com, Symmetricom, Telular, Terayon Comms Systems, Tier Technologies, Toshiba, Trikon Technologies, Tripath Technology, US Dataworks, Vastera, VeriSign, Vitria, VocalTec, XATA and Zygo.

Other financial news included analyst upgrades for Arrow Electronics, Avaya, Digital Insight, Intersil, JDS Uniphase, Netegrity, PC Connection, SeaChange International, Tibco, Tier, WebSense and Yahoo; analyst downgrades for Actuate, BearingPoint, Brooks Automation, i2 Technologies, Mapics and VISX; and share offerings from ON Semiconductor, Tibco and TiVo.

There were positive results/profit warnings from Agilent Technologies, Advantest, I/OMagic, SK Telecom, Trend Micro and Varian Semiconductor; negative results/profit warnings (often veiled) from Atari, Chartered Semiconductor, CTS, Fujitsu, LG Telecom, Nintendo, Novo Group, Toshiba and Veritas Software; share split announcements from Daleen (reverse), Microsemi (2:1), Stamps.com (reverse), Telemais Telecomms (reverse 1:10) and VR Systems (reverse); a good IPO on Nasdaq from Lipman Electronic Engineering; and a planned IPO in London from Cambridge Silicon Radio, a developer of Bluetooth wireless chips. Additionally, Take Two Interactive Software is re-stating its financials back to 1999.

Locally

Beget (-25%)
CCN (+35.3%)
Edutech (+14.3%)
Elexir (-33.3%)
Faritec (+20%)
Intervid (-8.9%)
Maxtec (-33.3%)
Pinnacle (-12.8%)
Spescom (+12.9%)
Stella Vista (-20%)

Internationally

Auspex Systems (-89.4%)
Cray (-30.3%)
Deutsche Telekom (+44.8%)
Digital Lightwave (+64.2%)
eGain (+52.1%)
i2 Technologies (-30.8%)
Provo International (+35.9%)
Read-Rite (+33.3%)
Silverline Technologies (-26.5%)
SONICblue (+100%)
Warthog (-41.6%)

In terms of indices, Nasdaq was down 2.6% and the JSE down 2% for the week.

There is always one company in the ICT community that one loves to hate. For some considerable time, Microsoft held that unenviable position, but the situation seems to have changed.

The SCO Group`s spate of Linux law suits, initially only against IBM, has catapulted it into 'the most hated ICT company` position.

With the resolution of the various issues still far from being finalised, this stigma is likely to be associated with SCO for some time to come.

* NB

Guidelines for the categorisation of results are as follows and are always in comparison with the equivalent period for the previous year; pro forma numbers are ignored (the terminology may vary slightly from country to country).

* Excellent: Both revenue and net income growth are in excess of 50%.
* Very good: Both revenue and net income growth are in excess of 25%
* Good: Both revenue and net income growth are in excess of 10%.
* Satisfactory: Revenue is within 10% of previous year and net income is up.
* Mediocre: Either revenue and/or net income is down.
* Very poor: Net income is less than 1% of revenue.
* Loss: A loss has been recorded.